2024-11-01
The report reveals that under Chair
Gary Gensler’s leadership, this “regulation by enforcement” strategy has cost
cryptocurrency firms a staggering $426 million in litigation expenses since
2021.
Beyond the financial toll, the report
suggests that this approach has hindered job growth, innovation, and investment in the U.S. tech sector, calling for urgent regulatory reform.
SEC’s “Anti-Crypto Crusade” and its
Financial Toll
Under Chair Gensler, the SEC has
reportedly targeted top U.S. crypto companies, it had brought 104 enforcement cases from
2021 until the end of 2023.
The Blockchain Association as an
“anti-crypto crusade,” these actions have required substantial legal defense
from crypto firms, forcing many to redirect resources away from innovation and
expansion.
The Blockchain Association argues that
while the cost of $426 million reflects the legal expenses directly, it does
not fully capture the broader impact of stifled innovation and missed economic
opportunities that Gensler’s enforcement has imposed on the industry.
The Impact SEC’s Enforcement: Losses in Jobs, Innovation, and Investments
The report emphasizes that these
enforcement measures have extended consequences, hampering job growth,
technological advancement, and competitiveness.
The Blockchain Association contends
that funds diverted to legal defenses could have been invested in R&D,
product development, and job creation, all critical to the growth of the
digital economy.
The loss of investment and innovation
resulting from this approach, the association argues, is incalculable, with
potential long-term repercussions for the U.S. position in the global digital
asset landscape.
Public Sentiment: Voters Favor Clear
Regulation Over Enforcement
To better understand public perception,
the Blockchain Association, in partnership with HarrisX, conducted a survey on
the SEC’s regulatory approach.
The results highlight widespread
dissatisfaction with the current enforcement-based strategy.
A significant two-thirds of surveyed
voters expressed a preference for clear, established guidelines over
litigation-driven enforcement, with many viewing the SEC’s actions as overly
harsh and detrimental to the industry.
Furthermore, polling indicates that
American voters are eager for change and want Congress to pass comprehensive
legislation tailored to the digital asset industry.
The Blockchain Association’s Call for
Leadership Change at the SEC
The Blockchain Association’s report
calls on policymakers to reconsider the SEC’s current direction under Gensler.
They advocate for a shift in leadership
and a move toward a regulatory framework that supports rather than penalizes
innovation.
By fostering a collaborative approach
to regulation, the Blockchain Association believes the U.S. could better
nurture its digital asset sector and maintain its competitive edge on the
global stage.
Congressional Action as a Path Forward
The Blockchain Association urges
Congress to establish a comprehensive legislative framework for digital assets.
With a clear, rule-based approach, the U.S. could foster growth while still
ensuring investor protection and compliance.
The report concludes that a new
legislative framework would not only clarify regulatory expectations for crypto
companies but also align with the American public’s call for transparency and
fairness in the digital economy.
